STATEMENT OF BASIS. for the issuance of Air Permit # 860-AOP-R6

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1 Page 1 of PERMITTING AUTHORITY: STATEMENT OF BASIS for the issuance of Air Permit # 860-AOP-R6 Arkansas Department of Environmental Quality 8001 National Drive Post Office Box 8913 Little Rock, Arkansas APPLICANT: Ciba Specialty Chemicals Corporation Bridgeport Road Industrial Park West Memphis, Arkansas PERMIT WRITER: Paula Parker 4. PROCESS DESCRIPTION AND SIC CODE: SIC Description: Intermediate Synthetic Organic Chemical Plant SIC Code: 2869 NAICS: SUBMITTALS: 5/20/04; 6/4/04; 6/23/04 6. REVIEWER=S NOTES: P2 Building A new product, a terpolymer compound, will be produced in the R-102 and R-103 (-P2-2 and -P2-3) reactors. The DADMAC terpolymer is produced in a similar manner as the current DADMAC polymer and DADMAC acrylamide products. Estimated emissions for this process are 0.2 lb/hr and 0.4 ton/yr VOC. Acrylic acid emissions are 0.10 lb/hr and 0.42 ton/yr. Another new product, NNDMA (N,N-dimethylacrylamide), is to be produced in 108 reactor of -P2-4. It is a multistep production process that uses an ester, an alcohol, and an amine to produce the final product and an alcohol coproduct.

2 Page 2 of 18 P4 Building The facility will install a new 20,000 gallon tank in the -P4-2 tank farm. The tank will vent to the existing P4 control system (-P4-1). Atmospheric emissions for this unit, as predicted by a TANKS calculation, are less than 0.1 ton/yr VOC. There is no permitted emission increase at -P4-1. Fugitive Sources The existing open neutralization basin will be replaced with two closed tanks of about 5,000 gallons each (-FS-4). The facility has plans to overhaul its wastewater treatment facility and the neutralization tanks are a preliminary activity. The estimated VOC content of the wastewater is 0.06%. A TANKS calculation resulted in less than 0.1 lb/hr and 0.1 ton/yr VOC (as methanol). The facility also requires methanol loading in the permit at FS-1, along with methyl methacrylate, cyclohexane, heptane, and NNMDA. The previous permit revision removed methanol loading at FS-1. Estimated emission increases from this request are 3.4 ton/yr VOC, 3.3 ton/yr methanol, and 0.03 ton/yr methyl methacrylate. 7. COMPLIANCE STATUS: The following summarizes the current compliance status of the facility including active/pending enforcement actions and recent compliance activities and issues: The facility has been issued a CAO to allow methanol loading at FS-1 and the production of NNDMA until a final permit is issued. 8. APPLICABLE REGULATIONS: A. Applicability Did the facility undergo PSD review in this permit (i.e., BACT, Modeling, et cetera) (Y/N) Has this facility underwent PSD review in the past (Y/N) Y_ Permit # _860-A Is this facility categorized as a major source for PSD? (Y/N) Y $ 100 tpy and on the list of 28 (100 tpy)? (Y/N) Y $ 250 tpy all other (Y/N) Y Y B. PSD Netting Was netting performed to avoid PSD review in this permit? (Y/N) N If so, indicate increases and decreases used in netting for PSD purposes only.

3 Page 3 of 18 C. Source and Pollutant Specific Regulatory Applicability: Source Pollutant Regulation [NSPS, NESHAP (Part 61 & Part 63), or PSD only] -P3-2* VOC NSPS Subpart Kb -P3-3* VOC NSPS Subpart Kb -P3-12* VOC NSPS Subpart Kb -P4-2* VOC NSPS Subpart Kb -P3-4** SO 2 NSPS Subpart Dc -P3-6** SO 2 NSPS Subpart Dc -P4-5** SO 2 NSPS Subpart Dc -P4-1 VOC NSPS Subpart NNN -P4-1 VOC NSPS Subpart RRR P1, P2, P3, P4 Processes FS-3 HAP NESHAP Subpart FFFF (MON) *The source numbers represent tank farms. For specific tank #s affected by Kb, please see p. the below table. **Sulfur dioxide regulation shall apply in situations where fuel oil is used in these sources. NSPS Subpart Kb Tanks Source Tank # Location Capacity Contents -P Tank Farm ,000 gallon Methyl Methacrylate -P Tank Farm ,500 gallon Methanol or AGE Water -P Tank Farm ,500 gallon Methyl Methacrylate or AGE -P Tank Farm ,500 gallon Methanol or AGE Water -P Tank Farm ,500 gallon Methyl Methacrylate or AGE -P Tank Farm ,500 gallon Methanol or AGE Water -P Tank Farm ,500 gallon Cyclohexane or AGE Distillation Heel -P Tank Farm ,500 gallon Methanol or AGE Water -P Tank Farm ,500 gallon Methanol or AGE Water

4 Page 4 of 18 NSPS Subpart Kb Tanks Source Tank # Location Capacity Contents -P Tank Farm ,000 gallon Allyl Chloride -P Tank Farm ,000 gallon Allyl Chloride -P Tank Farm ,000 gallon Dimethyl Amine -P4-2 - P4 Tank Farm 32,000 gallon Methyl Acrylate -P4-2 - P4 Tank Farm 32,000 gallon Methyl Acrylate -P4-2 - P4 Tank Farm 32,000 gallon Methyl Acrylate -P4-2 - P4 Tank Farm 32,000 gallon Methyl Acrylate -P4-2 - P4 Tank Farm 32,000 gallon Dimethylamino Ethanol -P4-2 - P4 Tank Farm 32,000 gallon Dimethylamino Ethanol -P4-2 - P4 Tank Farm 32,000 gallon Dimethylamino Ethanol -P4-2 - P4 Tank Farm 32,000 gallon Dimethylamino Ethanol -P4-2 - P4 Tank Farm 32,000 gallon Byproduct Methanol -P4-2 - P4 Tank Farm 32,000 gallon Byproduct Methanol -P4-2 - P4 Tank Farm 32,000 gallon Tetra Isopropyl Titanate -P4-2 - P4 Tank Farm 32,000 gallons Byproduct Isopropanol -P4-2 - P4 Tank Farm 20,000 gallons FA-1 -P4-2 - P4 Tank Farm 32,000 gallons Dimethyl Amino Ethyl Acrylate -P4-2 - P4 Tank Farm 32,000 gallons Dimethyl Amino Ethyl Acrylate -P4-2 - P4 Tank Farm 32,000 gallons Dimethyl Amino Ethyl Acrylate -P4-2 - P4 Tank Farm 32,000 gallons Dimethyl Amino Ethyl Acrylate -P4-2 - P4 Tank Farm 32,000 gallons Dimethyl Amino Ethyl Acrylate -P4-2 - P4 Tank Farm 32,000 gallons Dimethyl Amino Ethyl Acrylate

5 Page 5 of EMISSION CHANGES: The following table summarizes plantwide emission changes associated with this permitting action. Plantwide Permitted Emissions (ton/yr) Pollutant Air Permit Air Permit 860-AOP-R5 860-AOP-R6 Change PM/PM SO VOC CO NO X Acetone Acrylamide HAP Acrylic Acid HAP Allyl Chloride HAP Epichlorohydrin HAP Methanol HAP Methyl Methacrylate HAP Methyl Chloride HAP MODELING: A. Criteria Pollutants Examination of the source type, location, plot plan, land use, emission parameters, and other available information indicate that modeling is not warranted at this time. B. n-criteria Pollutants 1st Tier Screening (PAER) Estimated hourly emissions from the following sources were compared to the Presumptively Acceptable Emission Rate (PAER) for each compound. The PAER was deemed by the Department to be the product, in lb/hr, of 0.11 and the Threshold Limit Value (mg/m 3 ), as listed by the American Conference of Governmental Industrial Hygienists (ACGIH).

6 Page 6 of 18 Pollutant TLV (mg/m 3 ) PAER (lb/hr) = 0.11*TLV Proposed lb/hr Pass? Acrylamide HAP Acrylic Acid HAP Yes Allyl Chloride HAP Epichlorohydrin HAP Yes Methanol HAP Yes Methyl Methacrylate HAP Yes Methyl Chloride HAP Yes 2nd Tier Screening (PAIL) ISCST3 air dispersion modeling was performed on the estimated hourly emissions from the following sources, in order to predict ambient concentrations beyond the property boundary. The Presumptively Acceptable Impact Level (PAIL) for each compound was deemed by the Department to be one one-hundredth of the Threshold Limit Value, as listed by the ACGIH. Pollutant (PAIL, µg/m 3 ) = 1/100 of Threshold Limit Value Modeled Concentration (µg/m 3 ) Pass? Acrylamide HAP Yes Allyl Chloride HAP Yes

7 Page 7 of CALCULATIONS Emission Factor Source (AP-42, Testing, etc) Emission Factor and units (lbs/ton, lbs/hr, etc) Type ( if any) Efficiency Comments (Emission factor controlled/uncontrolled, etc) P1-1 Ideal Gas Law, Dalton=s Law. A lb/batch value mathematically derived for each component. See application for all component listings. Scrubber 90% P1-2 Ideal Gas Law, Dalton=s Law. A lb/batch value mathematically derived for each component. See application for all component listings. Scrubber 90% P1-3 Vendor data, Ideal Gas Law. 9 ppm acrylamide in air lost. - - P1-4 Vendor data, Ideal Gas Law. 9 ppm acrylamide in air lost. - - Supplied factor Supplied factor P1-5 EPA Tanks III software P1-6 EPA Tanks III software P1-7 Ideal Gas Law, Dalton=s Law. A lb/batch value mathematically derived for each component. See application for all component listings. Scrubber 90%

8 Page 8 of 18 Emission Factor Source (AP-42, Testing, etc) Emission Factor and units (lbs/ton, lbs/hr, etc) Type ( if any) Efficiency Comments (Emission factor controlled/uncontrolled, etc) P1-8 Facility estimate. T-200 Tank Farm vessels contain waterbased, low vapor pressure materials. Negligible VOC losses of <0.1 lb/hr expected P1-9 Ideal Gas Law, Dalton=s Law. A lb/batch value mathematically derived for each component. See application for all component listings. Chilled Vent Condenser, Scrubber Varies with each component. See application addendum dated 8/19/99. P2-1 Vendor data, Ideal Gas Law. 9 ppm acrylamide in air lost. - - P2-2 Vendor data, Ideal Gas Law. 9 ppm acrylamide in air lost. - - P2-3 Vendor data, Ideal Gas Law. 9 ppm acrylamide in air lost. - - Supplied factor Supplied factor Supplied factor

9 Page 9 of 18 Emission Factor Source (AP-42, Testing, etc) Emission Factor and units (lbs/ton, lbs/hr, etc) Type ( if any) Efficiency Comments (Emission factor controlled/uncontrolled, etc) P2-4 Ideal Gas Law, Dalton=s Law. A lb/batch value mathematically derived for each component. See application for all component listings. - - P2-5 Facility data. All methyl chloride charged assumed vented to scrubber: 60 lb/batch. Scrubber 88% P2-6 EPA Tanks III software P3-1 Ideal Gas Law, Dalton=s Law. A lb/batch value mathematically derived for each component. See application for all component listings. Scrubber 95% P3-2 EPA Tanks III software P3-3 EPA Tanks III software P3-4 EPA AP-42 Natural gas emission factors P3-5 Source removed. P3-6 EPA AP-42 Methanol Combustion Data Natural gas emission factors. Vendor Data (John Zink Company) - - -

10 Page 10 of 18 Emission Factor Source (AP-42, Testing, etc) Emission Factor and units (lbs/ton, lbs/hr, etc) Type ( if any) Efficiency Comments (Emission factor controlled/uncontrolled, etc) P3-7 EPA AP-42 Diesel engine emission factors P3-8 EPA Tanks III software P3-9 EPA Tanks III software P3-10a Ideal Gas Law, Dalton=s Law. A lb/batch value mathematically derived for each component. See application for all component listings. Chilled Vent Condensers 90% P3-10b Ideal Gas Law, Dalton=s Law. A lb/batch value mathematically derived for each component. See application for all component listings. Chilled Vent Condensers 90% P3-11 Ideal Gas Law, Dalton=s Law. Assumptions: 1) 1 scf/hr nitrogen purge. 2) 0.24 lb/hr released from feed stream solution. 3) 0.1 % by vol of feed stream is entrained air. Chilled Vent Condenser - Calculations did not use a blanket efficiency value. Vapor component concentrations calculated at inlet and outlet conditions.

11 Page 11 of 18 Emission Factor Source (AP-42, Testing, etc) Emission Factor and units (lbs/ton, lbs/hr, etc) Type ( if any) Efficiency Comments (Emission factor controlled/uncontrolled, etc) P3-12 Facility estimate. All vessels in Tank Farm 700 are under pressure and equipped with vapor recover/recirculation. VOC emissions expected to be negligible P3-13 Ideal Gas Law, Dalton=s Law. A lb/batch value mathematically derived for each component. See application for all component listings. - - P3-14 EPA Tanks III software P3-15 EPA Tanks III software P4-1 Facility data (scrubber column samples) from a sister plant in England. Inlet and outlet lb/hr values for each component given for each component. See application for all component listings. Caustic Scrubber and Carbon Beds 99% Outlet factors listed are post-control. P4-2 EPA Tanks III software P4-3 EPA AP-42 Equation L = 12.46*(SPM/t)*(1-eff) - - Equation P4-4 EPA Guidance Document SOCMI Fugitive Factors - - -

12 Page 12 of 18 Emission Factor Source (AP-42, Testing, etc) Emission Factor and units (lbs/ton, lbs/hr, etc) Type ( if any) Efficiency Comments (Emission factor controlled/uncontrolled, etc) P4-5 EPA AP-42 Natural gas emission factors P4-6 EPA Tanks III software P4-7 Facility data (scrubber column samples) from a sister plant in England. Inlet and outlet lb/hr values for each component given for each component. See application for all component listings. Scrubber 90% - P4-8 EPA Tanks III software P4-9 EPA AP-42 Diesel (#2 fuel oil) emission factors P4-10 EPA AP-42 Diesel (#2 fuel oil) emission factors P4-11 EPA AP-42 Diesel (#2 fuel oil) emission factors FS-1 EPA AP-42 Equation L = 12.46*(SPM/t)*(1-eff) - - Equation FS-2 EPA Guidance Document SOCMI Fugitive Factors FS-3 Facility wastewater samples. See application for wastewater sample results FS-4 EPA Tanks III software

13 Page 13 of 18 Emission Factor Source (AP-42, Testing, etc) Emission Factor and units (lbs/ton, lbs/hr, etc) Type ( if any) Efficiency Comments (Emission factor controlled/uncontrolled, etc) MI-1 EPA AP-42 Diesel (#2 fuel oil) emission factors

14 Page 14 of TESTING REQUIREMENTS: This permit requires stack testing of the following sources. (s) Pollutant Test Method -P1-9 VOC 25A Test Interval Every 30 months. -P3-6 VOC 25A One time -P3-6 NOx 7E One time -P3-6 Total Nitrogen BTU/lb Toluene Total Chloride Viscosity Total Nitrogen BTU/lb Toluene Viscosity RCRA -P4-1 VOC 25A -P4-7 VOC 25A Semi Annual One time. One time. Justification For Test Requirement To confirm calculation method used for this source. To confirm VOC estimates for byproduct combustion To confirm NOx estimates for byproduct combustion By-product stream sampling to ensure the constituents listed in this subpart, 40 CFR , are not present over RCRA threshold amounts To confirm calculation method used for this source. To confirm calculation method used for this source. 13. MONITORING OR CEMS

15 Page 15 of 18 The following are parameters that must be monitored with CEMs or other monitoring equipment (temperature, pressure differential, etc), frequency of recording and whether records are needed to be included in any annual, semiannual or other reports. -P1-9 -P2-5 -P3-1 Parameter or Pollutant to be Monitored Caustic Concentration Condenser Inlet Temp Caustic Concentration Caustic Concentration Method of Monitoring (CEM, Pressure Gauge, etc) Flow Meter ph Meter or Facility=s Choice Temp Monitor Flow Meter ph Meter or Facility=s Choice Flow Meter dual ph Probes Frequency* 3-hours 7 days-caustic 3-hours 3 hrs-flow Once/batchamine concentration 3 4-hours Report (Y/N)** -P3-10a Condenser Inlet Temp Temp Monitor 3 hrs -P3-10b Condenser Inlet Temp Temp Monitor 3 hrs -P3-11 Condenser Inlet Temp Temp Monitor 3 hrs -P4-1 -P4-7 Caustic/Acid Concentrations Caustic Concentration Flow Meter ph Meter or Facility=s Choice Flow Meter ph Meter or Facility=s Choice 3 hrs-flow 7 days-caustic and acid 2 3 hrs * Indicate frequency of recording required for the parameter (Continuously, hourly, daily, etc.) ** Indicates whether the parameter needs to be included in reports. te 1: The 3-hour caustic and acid sampling was adjusted to once every 7 operating days for the P-4-1 scrubbers, due to the supplementary monitoring data submitted May 11, te 2: The 3-hour amine concentration sampling was adjusted to once every batch for the P-2-5 scrubber, due to the supplementary monitoring data submitted May 19, RECORD KEEPING REQUIREMENTS

16 Page 16 of 18 The following are items (such as throughput, fuel usage, VOC content of coating, etc) that must be tracked and recorded, frequency of recording and whether records are needed to be included in any annual, semiannual or other reports. -P1-9 -P2-5 -P3-1 -P3-4 -P3-6 Recorded Item Caustic Concentration Condenser Exit Temperature Amine Concentration Caustic Concentration VE Readings VE Readings Limit (as established in permit) Per Manufacturer Per Manufacturer Frequency* 3 hr 7 days-caustic 3 hr Flow-3 hr Concentrationonce per batch Report (Y/N)** Per Manufacturer Every 4 hours 5% Opacity 20% Opacity (Diesel) 5% Opacity 20% Opacity (Diesel) Weekly 1 Weekly 1 -P3-6 Bi-Product Methanol Usage 4,600,000 gallons/yr Daily -P3-7 VE Readings 20% Opacity Daily 2 -P3-10a Condenser Exit Temp Per Manufacturer 3 hr -P3-10b Condenser Exit Temp Per Manufacturer 3 hr -P3-11 Condenser Exit Temp Per Manufacturer 3 hr -P3-7 Operating Hours 200 hr/yr Monthly -P4-5 -P4-1 -P4-7 VE Readings Caustic/Acid Concentrations Caustic Concentration 5% Opacity 20% Opacity (Diesel) Per Manufacturer Weekly Flow-3 hr Concentration- 7 days Per Manufacturer 3 hr -P4-9 VE Readings 20% Opacity Daily 2 -P4-10 VE Readings 20% Opacity Daily 2 -P4-11 VE Readings 20% Opacity Daily 2 -MI-1 Operating Hours 200 hr/yr Monthly

17 Page 17 of 18 Recorded Item Limit (as established in permit) Frequency* Report (Y/N)** -MI-1 VE Readings 20% Opacity Daily 2 All Sources Plantwide VOC lb/hr Emissions Permit Limit Monthly All Sources Plantwide HAP lb/hr Emissions Permit Limit Monthly All Sources Plantwide Criteria Pollutant ton/yr Emissions Permit Limit Monthly Yes All Sources Plantwide HAP ton/yr Emissions Permit Limit Monthly Yes * Indicate frequency of recording required for the item (Continuously, hourly, daily, etc.) ** Indicates whether the item needs to be included in reports te 1: Boiler VE readings only required when fuel oil use exceeds one week. te 2: Generator VE readings only required when testing/maintenance time exceeds 24 hours. 15. OPACITY Opacity % Justification (NSPS limit, Dept. Guidance, etc) Compliance Mechanism (daily observation, weekly, control equipment operation, etc) -P3-4 5% NGas 20% Diesel Department Guidance Weekly Observation 1 -P3-6 5% NGas 5%MeOH Department Guidance Weekly Observation 1 20% Diesel -P3-7 20% Department Guidance Daily Observation 2 -P4-5 5% NGas 20% Diesel Department Guidance Weekly Observation 1 -P4-9 20% Department Guidance Daily Observation 2 -P % Department Guidance Daily Observation 2 -P % Department Guidance Daily Observation 2 -MI-1 20% Department Guidance Daily Observation 2 te 1: Boiler VE readings only required when fuel oil use exceeds one week. te 2: Generator VE readings only required when testing/maintenance time exceeds 24 hours. 16. DELETED CONDITIONS:

18 Page 18 of 18 The following Specific Conditions were included in the previous permit, but deleted for the current permitting action. Former SC Justification for removal NONE 17. VOIDED, SUPERSEDED OR SUBSUMED PERMITS List all active permits for this facility which are voided/superseded/subsumed by issuance of this permit. Permit # 860-AOP-R5 18. CONCURRENCE BY: The following supervisor concurs with the permitting decision: Lyndon Poole, P.E.

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